Portugal's TAP posts wider first quarter loss as wage costs bite

LISBON (Reuters) - Portuguese airline TAP posted a wider first-quarter net loss of 72 million euros ($77.64 million) on Friday as higher wage costs offset revenue growth.

The state-owned airline had reported a net loss of 57.4 million euros a year ago.

Still, the airline expects a strong summer as it will add flights to Brazil and North America, CEO Luis Rodrigues said.

"The outlook for the summer 2024 remains positive, with forward bookings in line with 2023," the company said in a statement.

Operating income rose 3.1% to 862 million euros on a 5% increase in passenger revenue.

Passenger numbers rose 0.6% to 3.5 million.

The airline's operating costs rose 7.8% to 919 million euros reflecting a 57% jump in wage costs as it was forced to reverse most pay cuts imposed under a restructuring plan.

Portugal's new centre-right minority government has pledged to carry out a long-planned privatisation of the company, although it is not clear whether it will sell the whole company or a stake.

The previous Socialist government approved the sale of at least 51% of the company last September, but the process has stalled.

TAP had attracted interest from Lufthansa, Air France-KLM and British Airways owner IAG.

($1 = 0.9274 euros)

(Reporting by Patrícia Vicente Rua; editing by Inti Landauro and Jason Neely)